Saga has made a significant investment in its market research capabilities to bolster its ongoing brand revitalisation strategy, as the business aims to return to growth.
The financial and travel services company has acquired specialist research business The Big Window, which focuses on understanding the ageing process. The Big Window joins Saga as its new in-house “knowledge agency”, becoming one of its biggest business units.
Saga kicked off a new data, digital and brand strategy last year, with the aim of better aligning the brand with the modern mindset of its target market – people aged over 50.
According to the business, the acquisition of The Big Window will help Saga create tailored products and services for its customers, as well as unique points of difference across its travel, insurance and personal finance offerings. Its insight will also be used to improve the Saga Magazine and online content.
Already research by The Big Window shows most people over 50 (71%) feel their representation in the media is unfairly focused on age.
“Our customers tell us they think of themselves as experienced, not old,” says Saga CEO Euan Sutherland.
“We want to create experiences that mirror the reality of life for people over 50 in Britain and not just the stereotypes – driving better representation of what it means to be ‘experienced’ in business, advertising and the media.”
Becoming a ‘superbrand’
Saga announced the acquisition as it reported its preliminary results for the 12 months to January 31. The results showed narrowing losses for the group, which had struggled in its tour and cruise businesses during the pandemic.
Saga reported pre-tax losses of £23.5m over the year, compared to £61.2m in 2020. Net debt reduced by £31.2m over the year to £729m.
However, on an underlying basis the business reported a loss of £6.7m compared to a profit of £17.1m the year prior. Saga says this is partly down to increased investment into its marketing strategy.
In October 2021 the business relaunched its brand under the new platform ‘Experience is Everything’, marking an investment of £8.5m. The launch reflected a shift in focus away from short-term “sales-based programmatic” and towards long-term brand building and consideration.
At the time, chief customer officer Stuart Beamish told Marketing Week the brand had “sustained and built” high brand awareness over the years, but this hadn’t translated into consideration or sales.Saga chases consideration amid £8.5m brand building play
Over the 12 month period, Saga spent £20.8m on marketing in total compared to £14.9m the year previous.
As a result, the brand has seen its net promoter score (NPS) increase by 5 points to 49, and an improvement in its colleague engagement score to 7.7 out of 10.
Saga’s marketing spend in the cruise category saw a particular increase, from £7.1m to £12.1m. At the same time, the business saw “strong” bookings for the next year, and reported positive EBITDA profit in the second half of 2021 despite pandemic-related operational challenges.
The cruise business also achieved “exceptional” levels of customer satisfaction, at 9.1 out of 10.
The insurance business also saw “positive momentum” over the year, with 1.6m motor and home policies in force, 1.4% ahead of 2020.
Customer retention continued to improve at 82.8%, a 2.3 percentage points rise, and the proportion of new business acquired directly, rather than through price-comparison websites, remained stable at 59%.
We want to create experiences that mirror the reality of life for people over 50 in Britain and not just the stereotypes.
Euan Sutherland, Saga
Commenting on the group’s results, Saga CFO James Quin said the money invested into the new marketing strategy will pay dividends in future years.
“While profit was lower than in the prior year, this was in part due to increased marketing investment as we returned to television advertising in the later part of the year,” he explained.
“Given the timing of the spend, as well as the lead time in translating improved brand awareness and consideration into hard sales, the benefits of almost all of this spend will be in future years.”
Meanwhile, CEO Sutherland added the business is “confident” about future opportunities as pandemic restrictions are removed.
“We emerge stronger from the pandemic than we went in, whilst remaining mindful of the current challenging external environment,” he said.
Saga is now looking to convert the “foundations” laid over the past two years into sustainable growth, and is “further evolving” its strategic approach, Sutherland added.
That growth plan will see the business focus on positioning Saga as “the superbrand” for older people, he said.
“We already have a strong brand, management team and financial position – all the tools required to return the business to sustainable growth and create long-term value for our stakeholders.”